Inflation seen...

growth of six percent, said this is an indicator that the economy does not need further monetary stimulus at the moment. There remain risks from natural disasters and global developments including slower than expected growth among our trading partners but he said inflation is seen to have bottomed out last month. “As such we believe monetary settings continue to be appropriate for now. In addition to risks already mentioned we monitor commodity price developments,” said Tetangco.

FMIC-UAP, in its own research note, said that despite the El Nino dry weather conditions that are seen to persist until the first quarter of 2016, and the weak exports in the third quarter, they still expect gross domestic product to sustain its growth to 6.8 percent in the fourth quarter.

This, they said, will push the fullyear GDP growth to 6.1 percent.

J.P. Morgan Chase in a recent report said with low inflation and growth momentum on track, the BSP can afford to maintain current policy stance. “The benign inflation gives room for BSP to keep policy rates on hold.”

In the meantime, the US investment bank’s analyst forecast that fourth quarter inflation this year will average at 0.8 percent, below the inflation target range but it should “drift to the two percent range in third quarter 2016 as the commodity tailwind rolls off.”

The BSP continues to assess what it has been noting previously that there is no need to change policy settings at this time because of the weakness in the global economy and the continuing uncertainty in the global financial markets.